East Asia Needs $1 Trillion in Roads, Water, Communications, and Power Over Next Five Years

TOKYO, JAPAN (16 March 2005) - Developing countries in East Asia need to spend more than a trillion dollars over the next five years in roads, water, communications, power, and other infrastructure to cope with rapidly expanding cities, increasing populations, and the growing demands of the private sector, says a new study released here today by the ADB, Japan Bank for International Cooperation (JBIC), and the World Bank.

Government and private investment in infrastructure has been vital to growth in East Asia, providing the regional and international links for trade, and connecting rural and urban areas to help share the benefits of rapid growth. After the economic crisis of the late 1990s, private investment in infrastructure dropped off for countries like Indonesia and the Philippines, resulting in a serious infrastructure gap after years of little or no investment. Poorer countries in the region like Lao PDR and Cambodia continue to attract little or no private infrastructure funds.

Now, developing countries in East Asia face a massive infrastructure funding challenge. The study estimates that the 21 countries covered will need more than US$200 billion per year to fund new investment and maintenance of roads, power plants, communications, and water and sanitation systems. China is expected to require 80 percent of the total investment. A more active citizenry across the region is also demanding better services, including rural roads and bridges to access markets, and clean water and sanitation services.